By now most businesses are well versed in complying with the first phase of Single Touch Payroll (STP), an ATO initiative designed to streamline the reporting of employee pay, tax withheld and superannuation with the help of software providers like Xero, MYOB and QBO.

Now STP is being expanded in an effort to reduce the burden on employers who need to report employee information to multiple government agencies.

What isn’t changing?

• The way you lodge, pay, and update events
• Due date for lodging events
• The types of payments that are needed
• Tax and super obligations
• End of financial year finalisation event requirements

What is changing?

Additional reporting requirements of STP Phase 2 are designed to streamline employee interactions between the ATO and other government agencies and reduce administrative tasks associated with hiring and terminating employees.

The key reporting changes:

• Disaggregation of gross income amounts e.g. separate reporting of bonuses/commissions, leave, overtime, extra types of allowances, salary sacrifice
• Employment and taxation conditions e.g. reporting of employment basis (TFN declarations will no longer need to be submitted to the ATO as a separate process), termination reason (Employment separation certificates will no longer need to be issued), tax treatment
• Child support garnishees/deductions to be reported (separate remittances to the Child Support Registrar will no longer be required)
• Income types and country codes to be reported

For more information about STP Phase 2, refer to the ATO website.

What do I need to do?

The start date for STP Phase 2 is 1 January 2022, however the ATO has granted deferrals to some software providers.

Below are links to STP Phase 2 information from the most common payroll software providers:

Xero – extension to 31 December 2022

https://www.xero.com/blog/2021/10/stp-phase-2/

https://central.xero.com/s/article/About-Single-Touch-Payroll-Phase-2#HowSTPPhase2affectsyourbusiness

MYOB – extension to 01 January 2023

https://help.myob.com/wiki/display/ar/Getting+ready+for+STP+Phase+2

QBO
https://quickbooks.intuit.com/learn-support/en-au/payroll-processes/preparing-for-single-touch-payroll-stp-phase-2/01/984655

If you have any questions or require assistance with implementing STP Phase 2, please contact your trusted Adviser on (07) 3875 9888 – Salisbury office or (07) 3245 9966 – Capalaba and Woolloongabba.